Corporate lawyer

Meetings and resolutions that survive a challenge

Most corporate resolutions that get annulled are not annulled on the merits but on form: a defective notice, an imprecise agenda, minutes that do not record what was voted. Preparing a contentious general meeting is work done beforehand, not improvised on the day. And once a damaging resolution has been passed, the challenge has short deadlines that should not be allowed to run.

The director: appointment, removal and liability

Removing a director is easier than people think. Article 223 of the Spanish Companies Act allows the general meeting to dismiss a director at any time, with no cause required and even if it is not on the agenda. An ordinary majority is enough, and where the articles demand a reinforced one, the law caps it at two thirds.

The other side is liability. A director answers to the company, the shareholders and the creditors for acts contrary to the law or the articles and for those performed without due diligence. And one situation comes up again and again: failing to call a meeting when a ground for dissolution arises, which can make the director jointly liable for company debts incurred afterwards.

When shareholders stop understanding each other

Corporate deadlock gets worse on its own: every month without a decision reduces the value of the company and narrows the exits available to both sides. The law protects the shareholder far more than people expect, and there is no general ground of expulsion for simply falling out. The real routes are others: remove the director, buy the shares, trigger withdrawal where a ground exists, or seek dissolution through the courts if the governing bodies cannot function.

Transactions on the share capital

Increases with or without a premium, with pre-emption rights or excluding them, reductions to absorb losses or to return contributions, and accordion operations. All of them carry requirements on reports, publicity and deadlines which, if skipped, leave the resolution open to challenge and the registration impossible.

Annual accounts and registry obligations

Preparation, approval and filing all have dates. Failure to file closes the company's page at the Commercial Registry, which in practice blocks almost any subsequent registration, and exposes the company to penalties. It is the kind of problem that does not hurt until the day something has to be signed urgently.

Orderly dissolution and winding up

Closing a company properly is technical work and it protects whoever ran it. The ground is identified, the meeting called in time, a liquidator appointed, creditors paid in the order the law sets, and what remains distributed. Doing it badly, or leaving the company dormant without closing it, moves the problem onto whoever was signing.